Citi profit rises 30 percent as investment banking grows

April 15, 2013|David Henry and Tanya Agrawal | Reuters

The bank's overall first-quarter profit contributed to an increase in Citigroup's Basel III Tier 1 common equity ratio, an important regulatory measure of capital, to 9.3 percent at the end of March from 8.7 percent three months earlier, the company said.

Citigroup's book value per share rose 1 percent to $62.51 and its tangible book value per share rose to 3 percent to $52.35.

Citigroup's shares closed 9 cents up at $44.87 early Monday afternoon on the New York Stock Exchange, have reflected the sign of recovery at the bank. Their 16 percent increase this year compares with the KBW Bank index's 9.6 percent rise and the Standard & Poor's 500 11.4 percent.

Last month, Citigroup received Federal Reserve approval to buy back $1.2 billion of its shares.

That was a reversal from last year, when the bank failed to win Fed approval to distribute more capital to shareholders, which proved an embarrassment to Pandit. The episode helped weaken his standing with the board of directors and he resigned last October.

Even with an increase in Citigroup's net worth during the quarter, the market on Monday morning still valued the stock at only 0.88 times tangible book value per share, while shares of JPMorgan chase traded 1.24 times tangible book.

(Reporting by David Henry in New York and Tanya Agrawal in Bangalore; Editing by Supriya Kurane, John Wallace and Bernard Orr)